Methods and systems for managing investments in complex financial investments

ABSTRACT

A metric, Investment Participation at Cost (IPAC) has been developed to determine the amount of money working in an investment vehicle. IPAC has particular application in a complex, private equity investment vehicle. Using IPAC, an investor can get a repeatable, readily understood indication of the amount of working money left in an investment. Further using IPAC, the investor, financial advisor or other interested party can, based on the money still working in any one or more investments, better determine the overall risk profile of an investment portfolio. An investment portfolio can be changed based on the risk profile as so determined.

RELATED CASES

This case is related to co-pending U.S. patent application entitled“Methods and Systems for Managing Investments in Complex FinancialInvestments”, by Cobrinik et al., filed on May 7, 2001.

FIELD OF THE INVENTION

The present invention relates generally to methods and systems formanaging investments and more particularly to methods and systems fordetermining investor funds working in complex financial vehicles tomanage investments.

BACKGROUND OF THE INVENTION

The ability to determine risk apportionment in an investment portfoliois fundamental to the development and management of the portfolio. It iswell recognized that different investors, depending on both theirindividual life situations and personal financial goals, need investmentportfolios having different risk profiles. For example, an investorhaving substantial assets and desiring a high-return, long-terminvestment may look favorably on a portfolio biased towards high-riskinvestments. Such an investor does not anticipate the need to liquidateinvestments in the short term and will hence tolerate the volatilityassociated with high risk investments in light of the ultimately highexpected return.

In contrast, an investor facing retirement in a relatively short periodof time and facing the necessity of liquidating investments in order tofund that retirement may look more favorably on an investment portfoliobiased towards lower risk investments.

The risk profile of an investment portfolio depends upon the determinedinherent risk of the investment vehicles and the amount of resource,usually measured in monies, that is invested in the various investmentvehicles. It may be perfectly acceptable, for example, to have amoderate or low risk portfolio with one or more high-risk investments,so long as the amount of correlation of risk among investments remainsmoderate in view of the overall investments.

Risk determinations and hence portfolio profiles are more readilydetermined where the investment vehicles are publicly traded securitiesor fixed-income investments. Readily available methodologies exist fordetermining the amount of an individual investment in such vehicles.Many information sources are available to advise on the risks associatedwith such vehicles. Thus, it is relatively straight-forward to determinethe relative risks and monies invested in such publicly traded vehicles.Portfolio structuring and management can then be performed based on, asdiscussed above, each individual's personal situation and goals.

It is more difficult to make such determinations for private investmentsand particularly for complex private investments.

Considering, for example, a simple equity investment in a privately heldcompany, it can be seen that there is no reliable and repeatablemethodology or metric for determining the current value of an investmentafter it is initially made. Valuation of the company for purposes ofprivate funding rounds give some indication as to the transient value ofan equity investment at the time of closing of a round. However, this isnot a regularly available or reliable metric by which an investor canjudge the value of his investment. One reason is that such privatefunding rounds are relatively few and far apart. They do not account forinterim market changes or even regular daily or even hourly marketchanges that may actually affect the value of the private equity of acompany. Further, the valuation for private funding is typically set bya relatively few interested parties, particularly the principals of thecompany and the investors. This clearly will not produce the rigorousresults, as does the scrutiny of the vastly larger number of potentialinvestors in a public market.

As a private investment vehicle becomes more complex, the issuesassociated with valuing an investment in that vehicle also become morecomplex. Considering, for example, a private equity fund having multipleinvestors and multiple investments, the issues associated with valuingan investment in the fund become appreciably more complex. Thedifficulty of determining the value of investments in complex, privateinvestment vehicles makes it difficult or impossible to accuratelyanalyze the risk profile of an investment portfolio includinginvestments in such vehicles. In fact, not only is value difficult todetermine in these situations, but the term “value” itself haswell-defined legal meanings that have no readily determined correlationto complex private financial investment vehicles.

It would be useful to have a repeatable, supportable methodology andmetric for determining the current amount of an investor's investment ina private investment vehicle at any given time, termed herein the“working money” or amount of money working in any given financialvehicle. Such a metric and methodology would enable a more accurate riskassessment of a portfolio and enable the development of an investmentportfolio having a risk profile that meets the needs of the associatedinvestor. Such a metric and methodology would further facilitatedecisions such as whether to buy, sell or hold an investment. Suchmethods, systems and apparatuses are described and claimed herein.

SUMMARY OF THE INVENTION

An object of the present invention is to provide a method and system fordetermining the amount of money working in an investment in a privateinvestment vehicle.

A further object of the invention is to provide such a method and systemwhich facilitates the development of a risk profile of an investmentportfolio containing such a private investment vehicle.

Yet another object of the invention is to provide such a method andsystem which facilitates a decision as to whether to buy, sell or hold aposition in an investment.

In accordance with the present invention there is provided a new andimproved method and system for measuring and reporting an investor'sworking money in a complex investment vehicle.

In one embodiment of the invention, there is provided a method andsystem for determining an amount of investor money working in aninvestment vehicle including at least one investor and multipleinvestments, the method operable on a computer and comprising the stepsof: receiving into the computer fund management information relating tothe investment vehicle; receiving into the computer investor informationrelating to the investor; calculating on the computer an IPAC todetermine the amount of money working in the investment vehicle for theinvestor; and outputting from the computer the first IPAC; the step ofcalculating the IPAC comprising:

${IPAC}_{j} = {p_{j}*{\left( {a + {\sum\limits_{i = 1}^{n}\left( {r_{i}*l_{i}} \right)}} \right)/c_{t}}}$Wherel _(i)=min(c _(i) ,m _(i))

$c_{t} = {a + {\sum\limits_{i = 1}^{n}c_{i}}}$

-   -   where:

-   n=the total number of investments made by an investment vehicle to    date, including investments which have been liquidated such as being    paid out in cash or determined to have zero value

-   a=total called investor capital awaiting investment

-   c_(i)=the cost to the fund of the i^(th) investment of the n    investments

-   m_(i)=the most recent fair value of the i^(th) investment as    determined by the fund's manager

-   l_(i) (expressed formulaically above)−minimum (c_(i), m_(i)); i.e.    the lower of the cost of the i^(th) investment (i.e. c_(i)) or its    most recent fair value as determined by the fund manager, (i.e.    m_(i))

-   r_(i)=the percentage of the i^(th) investment of the fund remaining    at the time of the most recent distribution

-   p_(j)=the total capital called to date from the j^(th) investor

-   c_(t) (expressed formulaically above)=the total value of called    capital awaiting investment plus the aggregate cost of all n fund    investments

In another embodiment of the invention there is provided a method andsystem for managing an investment profile of an investor, the methodoperable on a computer and comprising the steps of: determining aninitial investment profile for the investor; developing, based on theinitial investment profile, a recommended investment portfolio includingcalculating an initial investment amount in an investment fund includingmultiple investments; inputting into the computer fund managementinformation relating to a change in one of the multiple investments;calculating on the computer an IPAC to determine the amount of moneyworking in the investment vehicle for the investor; the step ofcalculating the first IPAC comprising

${IPAC}_{j} = {p_{j}*{\left( {a + {\sum\limits_{i = 1}^{n}\left( {r_{i}*l_{i}} \right)}} \right)/c_{t}}}$Wherel _(i)=min(c _(i) ,m _(i))

$c_{t} = {a + {\sum\limits_{i = 1}^{n}c_{i}}}$

-   -   where:    -   n the total number of investments made by an investment vehicle        to date, including investments which have been liquidated such        as being paid out in cash or determined to have zero value    -   a=total called investor capital awaiting investment    -   c_(i)=the cost to the fund of the i^(th) investment of the n        investments    -   m_(i)=the most recent fair value of the i^(th) investment as        determined by the fund's manager    -   l_(i) (expressed formulaically above)−minimum (c_(i), m_(i));        i.e. the lower of the cost of the i^(th) investment (i.e. c_(i))        or its most recent fair value as determined by the fund manager,        (i.e. m_(i))    -   r_(i)=the percentage of the i^(th) investment of the fund        remaining at the time of the most recent distribution    -   p_(j)=the total capital called to date from the j^(th) investor    -   c_(t) (expressed formulaically above)=the total value of called        capital awaiting investment plus the aggregate cost of all n        fund investments

outputting from the computer the IPAC; and determining using the IPAC,if the initial investment portfolio including the change in one of themultiple investments satisfies the initial investment profile.

Further embodiments of the invention are provided for using IPAC tostructure an investment portfolio and to initiate a buy, sell or holdposition of an investment.

BRIEF DESCRIPTION OF THE DRAWING FIGURES

These and other objects, features and advantages of the invention willbe apparent from a consideration of the detailed description of theinvention when considered with the drawing Figures, in which:

FIG. 1 is a block diagram showing an exemplary relationship between aninvestor and related advisors and supporters;

FIG. 2 is a block diagram showing a computer system implemented inaccordance with the present invention;

FIG. 3 is a table showing the contents of the financial advisor databaseof FIG. 2;

FIG. 4 is a table showing the contents of the find management databaseof FIG. 2; and

FIG. 5 is a flow chart showing one method of managing the risk profileof an investment portfolio in accordance with the present invention.

DETAILED DESCRIPTION OF THE INVENTION

Described and claimed herein is a system and method for reliably andrepeatedly determining and expressing, in a readily understandablemanner, a metric indicating the amount of an investor's money working ina complex investment vehicle at any given time. Also set forth is asystem and method for using the above to structure a portfolio, todetermine and manipulate the risk profile of an investment portfolio andto initiate actions such as buy/sell/hold of investments in a portfolio.

Definitions

As used herein, the terms “investment vehicle” and “vehicle” include allprivate investment mediums where funds are collected from one or moreinvestors for investment in one or more investments, including but notlimited to private equity funds and real estate private equity funds.The term vehicle is used interchangeable with types of investmentmechanisms, such as investment funds.

In accordance with the present invention, the inventors have developedthe following metric: “Investment Participation At Cost”, or IPAC. Asused herein, “IPAC” means a measure of working money determined inaccordance with the following equation:

${IPAC}_{j} = {p_{j}*{\left( {a + {\sum\limits_{i = 1}^{n}\left( {r_{i}*l_{i}} \right)}} \right)/c_{t}}}$Wherel _(i)=min(c _(i) ,m _(i))

$c_{t} = {a + {\sum\limits_{i = 1}^{n}c_{i}}}$IPAC is applied to measure the amount of working capital IPAC_(j) of anyindividual investor (i.e. any j^(th) investor) in any given investmentvehicle (or fund) having multiple (i.e. n) investments, where:

-   n the total number of investments made by an investment vehicle to    date, including investments which have been liquidated such as being    paid out in cash or determined to have zero value-   a=total called investor capital awaiting investment-   c_(i)=the cost to the fund of the i^(th) investment of the n    investments-   m_(i)=the most recent fair value of the i^(th) investment as    determined by the fund's manager-   l_(i) (expressed formulaically above)−minimum (c_(i), m_(i)); i.e.    the lower of the cost of the i^(th) investment (i.e. c_(i)) or its    most recent fair value as determined by the fund manager, (i.e.    m_(i))-   r_(i)=the percentage of the i^(th) investment of the fund remaining    at the time of the most recent distribution-   p_(j)=the total capital called to date from the j^(th) investor-   c_(t) (expressed formulaically above)=the total value of called    capital awaiting investment plus the aggregate cost of all n fund    investments

For purposes of describing the operation of the IPAC metric and its useto manage risk allocation in an investment portfolio, the illustrativeinvestment vehicle to which IPAC is applied will be a private equityinvestment fund. The investments made by the fund will be assumed to beequity investments in privately held companies. As will be appreciated,the invention has larger application to other private investmentvehicles and investments such as the real estate private investment fundmentioned above.

Describing the operation of the IPAC metric in written word, IPACrepresents an investor's total capital called to date, multiplied by aratio that represents the percentage of that capital which is still ineffect working for the investor after one or more specific investmentshave been partially or fully liquidated. The denominator of the ratio isthe total cost of all investments made by the fund (excluding managementfees). The numerator is the total cost of all investments that have notyet been liquidated and distributed. Where the aggregate fair value ofall remaining investments, as determined by a fund manager, is lowerthan their cost, then that lower value is used in the numerator.

The IPAC metric generally changes only in limited circumstances,including:

-   -   1. when there is a capital call;    -   2. when there is a full or partial cash payout from one or more        individual investments; or    -   3. when there is a change in the aggregate fair value as        determined by the fund's manager of all investments and either        the new fair value or the old fair value or both are lower than        the cost.

It will be appreciated that it is this very simplicity, i.e. the factthat the IPAC metric changes in a relatively straightfoward manner inresponse to simple changes in the amount of capital called ordistributed that makes IPAC a useful metric for measuring working money,making investment decisions and managing the risk profile of aninvestment portfolio.

For purposes of illustration, several examples of the implementation ofthe IPAC metric will now be examined.

EXAMPLE I

Given the following facts and figures relating to a private equityinvestment fund:

-   -   Number of Investors=100    -   Capital called per investor=$1,000,000.00    -   Total capital collected=100×$1,000,000.00=$100,000,000.00    -   Total fund management fees equal 1% of total capital collected,        or $1,000,000.00    -   Total invested capital equals the total capital collected less        the management fees, or $99,000,000.00    -   Total initial invested capital per investor equals the called        capital less management fees, or $990,000.00    -   Number of investments=n=10    -   Total capital awaiting investment=a $0    -   Cost per investment=c_(i)=$9,900,000.00    -   Market value=m_(i)=c_(i) is not less than $9,900,000.00 for all        investments    -   Investment 1 has been sold in it's entirety for $50,000,000.00    -   As a result of the sale of investment 1, the sum of $500,000.00        has been returned to each of the 100 investors    -   Each of the remaining investments remains untouched, that is        r_(i)=100% for the remaining 9 investments

Assuming now that it is desired to calculate the working money of one ofthe investors in the fund for purposes of evaluating the risk profile ofhis overall investment portfolio.

As noted above, one of the initial 10 investments has been liquidatedand distributed in its entirety. Because each of the remaininginvestments is whole (r_(i)=100%) and in no case is the fair value lessthan the cost (min (c_(i); m_(i))=ci for all i), then the bracketednumerator of IPAC=9×$9,900,000, or $89,100,000.00. The total of allcalled and invested capital=c_(t)=$99,000,000.00.

Thus, the IPAC of any investor whose total working capital called todate=p_(j)=$990,000.00 is 89.1/99 ×$990,000.00 or $891,000.00.

EXAMPLE II

Assuming now that 50% of a second investment in the same fund isliquidated for an amount of $100,000,000.00. $1,000,000.00 issubsequently paid out to each investor. All other positions and valuesrelating to the fund and to the investments therein remain the same. Itis noted that the remaining 50% of the fund has the same fair marketvaluation as the liquidated half, or $100,000,000.00 (this will berelevant to EXAMPLE III below).

Because the market value of the partially liquidated fund has increased,the sum of the costs will be the min factor in the numerator and it willbe calculated now that the numerator of IPAC drops by $4,950,000.00,i.e. one-half of the cost of the 50% liquidated investment, i.e. from$89,100.000.00 to $84,150,000.00.

The IPAC of each investor whose total working capital called to dateremains at $990,000.00 is 84.15/99 of the working invested capital, i.e.84.15/99 ×$990,000.00 or $841,500.

EXAMPLE III

Assuming now that one of the remaining investments goes bankrupt, thevalue thereof dropping to 0, while a second investment has a marketvalue, based on a recent initial public offering, of $4,950,000.00, or ½of its initial cost. In this example, there are no additional payouts toinvestors but only diminished values based on the changing market valueof the investments. All other positions and values relating to the fundand to the investments therein remain the same.

While several of the investments have been devalued, it will be notedthat due to the increase in market value of the investment noted inEXAMPLE II above, the overall market value of the investment fund hasincreased. Thus, IPAC will use the lesser of market value or cost, i.e.cost. It will be readily calculated that the numerator of IPAC drops by$14,850,000.00, i.e. the value of the drop in the two noted investments,to from $84,150,000.00 to $69,300,000.00. That is, the bankruptinvestment drops from the initial cost of $9,900,000.00 to a value of 0.The publicly offered investment has been determined by the public marketto have a decrease in value of $4,950,000.00 from its initial cost of$9,990,000.00 down to $4,950,000,00. Since the market value of allremaining investments is less than their cost, the lower figure is usedin the numerator.

The IPAC of each investor whose total working capital called to dateremains at $990,000.00 is 69.3/99 of that invested capital, or$693,000.00.

EXAMPLE IV

Assuming now that an additional capital call is placed to each investorfor an additional $100,000.00 each. This additional capital is held andnot immediately invested, and hence, after the deduction of a 1%management fee, the value of a increases from 0 to 100×$99,000.00 or$9,900,000.00. All other positions and values relating to the fund andto the investments therein remain the same.

It will again be calculated that the numerator of IPAC increases by thevalue of a, the additional called capital, to$69,300,000.00+$9,900,000.00 or $79,200,000.00. The denominator of IPACsimilarly increases by the value of a, the additional called capital, to$99,000,000.00+$9,900,000.00, or $108,900,000.00.

Each investor now has committed $1,089,000.00 in working called capital.

The IPAC for each investor is thus 79.2/108.9 ×$1,089,000.00x=$792,000.00.

It will be appreciated that if at any time IPAC was calculated the totalmarket value of the investments was less than the total cost of theinvestments, then the lower market value would constitute IPAC. Whilemarket value can go below cost at any time in the life of the fund, itis typically more likely to happen early in the life of a fund beforeany single one of the investments has an opportunity to appreciate invalue, thereby offsetting losses in the remaining funds.

It will thus be seen that, as a metric, IPAC provides a repeatable andunderstandable calculation representative of the amount of an investor'smoney working in a complex, otherwise difficult to value, privateinvestment. The IPAC metric is determined independently of the amount ofany payouts the fund may return to its investors. It is independent ofany fees such as management fees which may be associated with theoperation of the fund. With the exception of a diminution of aninvestment market value below the actual fund investment cost, or anevent that liquidates an investment with no payout (i.e. a bankruptcy),the IPAC is further independent of transiently diminished values of thevarious investments.

To avoid confusion and complexity, the IPAC ignores investmentmanagement costs, which are reported to investors in other standardizedreports. Further, IPAC is clearly distinguishable from “value,” which asdescribed above has definitive legal meanings and which is difficult orimpossible to determine in a private equity investment.

As will be seen from a consideration of the materials set out below,because IPAC can be equated with monies working in an investmentvehicle, it can be used to make buy, sell or hold decisions and todetermine the relative risk profile of an investment portfolio.

Description of the System

With reference now to FIG. 1, a block diagram 10 is shown illustratingtypical relationships between an investor 12 and the various partiesassociated with advising, counseling and assisting the investor indeveloping an investment portfolio and making investments such as in aninvestment vehicle 14. For purposes of illustration, investment vehicle14 comprises a private equity fund of the type described above.

Investor 12 typically establishes a relationship with a financialadvisor or counselor, 16, whose function it is to advise the investorboth on the development of an overall investment portfolio and onindividual investments such as fund 14. Financial advisor 16communicates with an investment advisor 18 who functions to identify andcharacterize investments for consideration by investor 12. Financialadvisor 16, and investment advisor 18 and may work, for example, for aninvestment bank. Typically, multiple investment vehicles 14 will beidentified and available to investor 12, each having differentinvestment characteristics and risk profiles.

With reference now to FIG. 2, one exemplary computer system 22 is shownfunctional to implement the present invention. Computer system 22 isseen to include a processor 24 and a database 28. Processor 24 comprisesa standard computing system such as an Intel™ microprocessor-basedsystem running a Microsoft™ Windows™ operating system. Database 28comprises a conventional storage device comprising an appropriatecombination of magnetic, optical and semiconductor storage medium.

Processor 24 includes a conventional network connection (not shown) forproviding a communications interface to other computing systems.Processor 24 further comprises conventional communications interfacesfor communicating with investor 12 through, for example, a website 23,an e-mail system 25 or a facsimile device or printer 27. These and otherequivalent communications interfaces and devices are well known to thoseskilled in the art.

Database 28 is seen to include a financial advisor database 30containing records such as investor goals, called capital, distributedcapital and committed capital, and current investment information. Afund management database 40 contains information such as fundidentification and risk assessment information, as well as fundfinancial information including the cost of the investment, fair valueof the investment (as determined by the fund management) and theremaining portion to be invested.

Database 28 further includes an IPAC program 27, comprising a computerimplementation of the IPAC metric described above, implemented using anyconventional programming language, for example C or Fortran, orimplemented in a conventional spreadsheet, for example Microsoft™EXCEL™.

As described in detail below, program 27 receives information fromfinancial advisor database 30 and fund management database 40 andoperates to calculate an IPAC metric. Once determined the IPAC may thenbe output, for example and without limitation, in humanly readable formsuch as to a printer, a website, or an email. The financial advisor 16and investor 12 may then use this output to make decisions to increase,decrease or leave unchanged their invested capital.

Description of the Databases

Referring now to FIG. 3, financial advisor database 30 is shown toinclude two data records 32 and 34, respectively, each including eightfields indicated at 30A-30H. It will be appreciated that any number offields can be contained in investor database 30.

Financial advisor database 30 is constructed to include relevantinformation relating to investor(s) 12 for use by financial advisor 16.Examining the contents of financial advisor database 30, field 30A isseen to include the investor name. Additional fields include investorinformation (30B), investor goals and risk profile (30C), capital statusincluding amounts of called, committed and distributed investmentcapital (30D), initial investment vehicle gross investments (30E),initial investment vehicle by percentage (30F) and updated investmentvehicle gross investment and by percentage (30G and 30H, respectively).

When financial advisor database 30 is developed and maintained byfinancial advisor 16, the advisor collects the investor information(field 30B) necessary to develop the investor risks and goals (field30C). Relevant investor information may include, for example and inaddition to standard identifying information, age, occupation, familystatus, current financial position, anticipated retirement goals andpension, and additional other information that will assist the advisorin developing a portfolio recommendation including a risk profile.

Capital status information (30D) is maintained to describe the financialstatus of the investor relative to his investments. This field mayinclude, for example and without limitation, investor capitalinformation such as: total funds committed by the investor, funds calledfrom the investor but not yet distributed and funds both called anddistributed.

As seen in financial advisor database 30, the investor John Smithidentified in data record 32 is best served by an investment portfolioweighted towards long-term, high-return, high-risk investments. Incontrast, investor Bob Kline, identified in data record 34, is bestserved by a lower risk, lower return investment portfolio.

The nature of the remaining data fields in investor database 30 will bedescribed in detail with respect to the process illustrated in FIG. 5below.

With reference now to FIG. 4, fund management database 40 is shown toinclude two data records, record 42A including information relating to afund A, and record 44 including information relating to a fund B. Inpractice, it will be understood that fund management database 40 caninclude any number of data records to track multiple investmentvehicles.

Fund management database 40 is constructed to track information relatingto various investment funds. Examining the contents of fund database 40,field 40A is seen to include information identifying the variousinvestment funds, while detailed fund information is stored in field40B. Detailed fund information includes information relating to themanagement and various investments of the funds. Detailed financialinformation relating to the fund, for example including committed andinvested funds as well as a history of fair market value determinations(as determined by the fund management) is maintained in field 40C. Arisk assessment of each fund, determined for example by investmentadvisor 18, is stored in data field 40D, while fund payout events arestored in field 40E.

Both of the funds A and B are seen to comprise high-risk investments.

Fund payout events (field 40E) include events that directly affect thevalue of the fund investments, including but not limited to: liquidationof equity to fund partial or fall investor payouts, bankruptcy orclosure events that would drive value to 0, initial public offerings andother events well known to those skilled in the art.

Description of Operation

With reference now to FIG. 5, one process 50 is shown for developing andmanaging an investment portfolio in accordance with the presentinvention.

Initially, a financial advisor 16 interviews an investor 12 to collectnecessary information regarding the investor's personal and financialsituation (step 52) so as to develop a recommended portfolio based atleast in part on an appropriate risk profile (step 54). This informationis stored infinancial advisor database 30. Subsequently, financialadvisor 16 may recommend that at least some of the funds available forinvestment be placed into an investment vehicle such as fund A or B infund management database 40 (step 56).

Upon placement of the investor monies in the appropriate funds(s),fields 30D, 30E and 30F of financial advisor database 30 are updated toreflect the initial costs both by gross dollar amount (fields 30D, E)and by percentage of total portfolio (field 30F) (step 58).

Subsequently, the portfolio is watched in a well-known manner as itsvalue changes with respect to fluctuations in prices of publicly tradedequities and fixed-income investments (not shown). The portfolio profilecan be updated in a conventional manner as these values fluctuate.Readily liquid investments can be altered as deemed desirable by theinvestor and the financial advisor.

With respect to the present invention, the next significant event is thereceipt of notice of an event that changes the value of an investment infund A or B (step 60). Such an event may comprise, for example, someliquidation of equity so as to liquidate some or all of the fund'sinterest in the vehicle. Other events include, for example, bankruptcy,a public offering, or such other event that will directly affect thevalue of the find investment in the vehicle so as to affect the IPAC inthe manner described hereinabove.

Subsequent to the receipt of notice of such an event, the IPAC iscalculated for individual investors, as per the examples describedabove, to determine the amount of money each investor still has workingin the fund (step 62).

Because each investor's working monies in the vehicle experiencing theevent will have changed, it becomes desirable to determine the new (i.e.updated or actual) investment risk profile (step 64). This is done byusing the IPAC metrid to determine actual gross investment (field 30G ofFIG. 3) and percentage investment (field 30H of FIG. 3) of working moneyremaining in the investment vehicle. It will be understood that the IPACvalue itself is, in fact, calculated on the gross investment (30G),while the percentage of that gross investment relative to the values ofthe other investments in the portfolio represents the percentageinvestment (30H)t.

Subsequently, the actual risk profile in view of the investment event iscompared with the desired risk profile established at the outset (step66) to determine if the investor's portfolio profile continues to meethis or her needs (step 68). If the investment profile is appropriate, itmay be recommended that no change be made (step 70). If the investmentprofile is no longer appropriate in view of the change in the investor'smoney working in the fund that underwent the event, then it may berecommended that the investor revisit the portfolio (step 72) with theview of changing distributions in various individual investments.

With reference back to FIG. 1, investor notification of informationrelating to his investments, including the IPAC metric described herein,may be communicated to investor 12 via a communications channel such asan Internet website, an e-mail, a facsimile, a printout (mailed, forexample) or other well-known methods of communications includingbroadcast to cellular telephones and personal digital assistants. Itwill be understood that the development of a changed or new investmentportfolio will be accomplished through the sale or purchase of aninvestment or other management of the investor's funds in manners wellknown in the art.

EXAMPLE V

With reference to FIGS. 3 and 4, it is seen that investor John Smith(record 32 of FIG. 3) was initially set up with a relatively high-riskportfolio including investments of $1M each, or 20% of total investmentseach for a total of 40% of the portfolio, in high-risk fund vehicles A &B (see fields 30E and 30F of FIG. 3). Subsequent to a fund event, forexample a payout based on his investment in fund A, his IPAC in vehicleA dropped to 0 (field 30H) and his total investment in the high-risk,private equity funds A and B dropped to a total of 25%.

John Smith and his financial advisor will thus evaluate the new riskprofile of his investment portfolio to determine if changes areappropriate.

EXAMPLE VI

With reference to FIGS. 3 and 4, it is seen that investor Bob Kline(record 34 of FIG. 3) was initially set up with a relatively low-riskportfolio including an investment of $250K, or 5% of total investments,in high-risk fund vehicle A (see fields 30E and 30F of FIG. 3).

Subsequent to a fund event, one-half of Kline's equity interest in fundA, the total of which was purchased for the $250,000.00 noted above, wasliquidated, paying to him the amount of $500,000.00.

It will be appreciated that, using traditional methodologies, there isno appropriate, simple and understandable methodology for informingKline of the relative amount of his investment still working in vehicleA. For example, a methodology based on the increased value of the fundwill grossly inflate his actual cash investment in comparison to otherinvestments.

However, using the IPAC metric described above, it can be determinedthat Kline still has $125,000.00 of his initial investment actuallyworking for him in fund A. Thus, for purposes of determining the riskprofile of his investment portfolio, 2.5% of his investment dollarscontinue to work for him in high-risk fund A.

Based on this analysis, Kline and his financial advisor can determine ifhis investment portfolio should be adjusted.

While the invention has been shown and described with respect to riskmanagement, IPAC can be used at any time and for any reason with respectto facilitating a decision to buy, sell or hold an investment positionor to otherwise structure an investment portfolio.

While the invention has been shown and described with respect toparticular embodiments, numerous modifications, changes, variations andimprovements will occur to those skilled in the art that fall within thecontemplation of this patent.

1. A method of using a computer to determine an amount of investor moneyworking in an investment vehicle including at least one investor andmultiple investments, comprising the steps of: receiving fund managementinformation relating to said investment vehicle; receiving investorinformation relating to an investor; calculating on said computer, usingsaid fund management information and said investor information, an IPACto determine the amount of money working in said investment vehicle; andoutputting from said computer said IPAC; wherein said investment vehicleis selected from the group consisting of: (a) a private equity fund; and(b) a real estate private equity fund; said step of calculating saidIPAC comprising${IPAC}_{j} = {p_{j}*{\left( {a + {\sum\limits_{i = 1}^{n}\left( {r_{i}*l_{i}} \right)}} \right)/c_{t}}}$Wherel _(i)=min(c _(i) ,m _(i))$c_{t} = {a + {\sum\limits_{i = 1}^{n}c_{i}}}$ where: n=the total numberof investments made by an investment vehicle to date, includinginvestments which have been liquidated such as being paid out in cash ordetermined to have zero value a=total called investor capital awaitinginvestment c_(i)=the cost to the fund of the i^(th) investment of the ninvestments m_(i)=the most recent fair value of the i^(th) investment asdetermined by the fund's manager l_(i) (expressed formulaicallyabove)−minimum (c_(i), m_(i)); i.e. the lower of the cost of the i^(th)investment (i.e. c_(i)) or its most recent fair value as determined bythe fund manager, (i.e. m_(i)) r_(i)=the percentage of the i^(th)investment of the fund remaining at the time of the most recentdistribution p_(j)=the total capital called to date from the j^(th)investor c_(t) (expressed formulaically above)=the total value of calledcapital awaiting investment plus the aggregate cost of all n fundinvestments.
 2. A method in accordance with claim 1 and furtherincluding the steps of: calculating an individual IPAC for each of aplurality investors in said investment vehicle; and outputting each ofsaid individual IPAC's.
 3. A method in accordance with claim 2 andfurther including the steps of: outputting for each of the investors aprofile including a list of said multiple investments of said investmentvehicle; outputting for each of the investors said IPAC; and providing arespective profile and IPAC to each of the investors.
 4. An apparatusfor determining an amount of investor money working in an investmentvehicle including at least one investor and multiple investments,comprising: a processor; a memory connected to said processor, saidmemory including instructions for controlling the operation of saidprocessor; said processor operative with said instructions in saidmemory to perform the steps of: inputting into the computer fundmanagement information relating to said investment vehicle; inputtinginto the computer investor information relating to an investor;calculating on said computer, using the fund management and investorinformation, a first IPAC to determine the amount of money working insaid investment vehicle for a first investor; and outputting from saidprocessor said IPAC; wherein said investment vehicle is selected fromthe group consisting of: (a) a private equity fund; and (b) a realestate private equity fund; said step of calculating said IPACcomprising:${IPAC}_{j} = {p_{j}*{\left( {a + {\sum\limits_{i = 1}^{n}\left( {r_{i}*l_{i}} \right)}} \right)/c_{t}}}$Wherel _(i)=min(c _(i) ,m _(i))$c_{t} = {a + {\sum\limits_{i = 1}^{n}c_{i}}}$ where: n=the total numberof investments made by an investment vehicle to date, includinginvestments which have been liquidated such as being paid out in cash ordetermined to have zero value a=total called investor capital awaitinginvestment c_(i)=the cost to the fund of the i^(th) investment of the ninvestments m_(i)=the most recent fair value of the i^(th) investment asdetermined by the fund's manager l_(i) (expressed formulaicallyabove)−minimum (c_(i), m_(i)); i.e. the lower of the cost of the i^(th)investment (i.e. c_(i)) or its most recent fair value as determined bythe fund manager, (i.e. m_(i)) r_(i)=the percentage of the i^(th)investment of the fund remaining at the time of the most recentdistribution p_(j)=the total capital called to date from the j^(th)investor c_(t) (expressed formulaically above)=the total value of calledcapital awaiting investment plus the aggregate cost of all n fundinvestments.
 5. The apparatus of claim 4 wherein said processor isfurther operative to perform the steps of: calculating an individualIPAC for each of a plurality of investors in said investment vehicle;and outputting each of said individual IPAC's.
 6. The apparatus of claim5 wherein said processor is further operative to perform the steps of:outputting for each of the investors a profile including a list of saidmultiple investments of said investment vehicle; outputting for each ofthe investors said IPAC; and providing a respective profile and IPAC toeach of the investors.
 7. The apparatus of claim 5 wherein said memoryfurther stores a financial advisor database containing informationrelating to the at least one investor.
 8. The apparatus of claim 5wherein said memory further stores a fund management database containinginformation relating to said multiple investments.
 9. An apparatus fordetermining an amount of investor money working in an investment vehicleincluding at least one investor and multiple investments, comprising:means for determining fund management information relating to saidinvestment vehicle; means for determining investor information relatingto an investor; means for calculating, using said fund managementinformation and said investor information, an IPAC to determine theamount of money working in said investment vehicle for a first investor;and means for outputting said IPAC; wherein said investment vehicle isselected from the group consisting of: (a) a private equity fund; and(b) a real estate private equity fund, said step of calculating saidIPAC comprising:${IPAC}_{j} = {p_{j}*{\left( {a + {\sum\limits_{i = 1}^{n}\left( {r_{i}*l_{i}} \right)}} \right)/c_{t}}}$Wherel _(i)=min(c _(i) ,m _(i))$c_{t} = {a + {\sum\limits_{i = 1}^{n}c_{i}}}$ where: n=the total numberof investments made by an investment vehicle to date, includinginvestments which have been liquidated such as being paid out in cash ordetermined to have zero value a=total called investor capital awaitinginvestment c_(i)=the cost to the fund of the i^(th) investment of the ninvestments m_(i)=the most recent fair value of the i^(th) investment asdetermined by the fund's manager l_(i) (expressed formulaicallyabove)−minimum (c_(i), m_(i)); i.e. the lower of the cost of the i^(th)investment (i.e. c_(i)) or its most recent fair value as determined bythe fund manager, (i.e. m_(i)) r_(i)=the percentage of the i^(th)investment of the fund remaining at the time of the most recentdistribution p_(j)=the total capital called to date from the j^(th)investor c_(t) (expressed formulaically above)=the total value of calledcapital awaiting investment plus the aggregate cost of all n fundinvestments.
 10. A program product containing computer-executableinstructions operative to control a computer to determine an amount ofinvestor money working in an investment vehicle including at least oneinvestor and multiple investments, said program product comprising: saidinstructions operative to control said computer to perform the steps of:inputting into the computer fund management information relating saidinvestment vehicle; inputting into the computer investor informationrelating to an investor; calculating on said computer, using said fundmanagement information and said investor information, an IPAC todetermine the amount of money working in said investment vehicle for ainvestor; and outputting from said computer said IPAC; wherein saidinvestment vehicle is selected from the group consisting of: (a) aprivate equity fund; and (b) a real estate private equity fund; saidstep of calculating said IPAC comprising${IPAC}_{j} = {p_{j}*{\left( {a + {\sum\limits_{i = 1}^{n}\left( {r_{i}*l_{i}} \right)}} \right)/c_{t}}}$Wherel _(i)=min(c _(i) ,m _(i))$c_{t} = {a + {\sum\limits_{i = 1}^{n}c_{i}}}$ where: n=the total numberof investments made by an investment vehicle to date, includinginvestments which have been liquidated such as being paid out in cash ordetermined to have zero value a=total called investor capital awaitinginvestment c_(i)=the cost to the fund of the i^(th) investment of the ninvestments m_(i)=the most recent fair value of the i^(th) investment asdetermined by the fund's manager l_(i) (expressed formulaicallyabove)−minimum (c_(i), m_(i)); i.e. the lower of the cost of the i^(th)investment (i.e. c_(i)) or its most recent fair value as determined bythe fund manager, (i.e. m_(i)) r_(i) the percentage of the i^(th)investment of the fund remaining at the time of the most recentdistribution p_(j)=the total capital called to date from the j^(th)investor c_(t) (expressed formulaically above)=the total value of calledcapital awaiting investment plus the aggregate cost of all n fundinvestments.
 11. A method of determining an amount of investor moneyworking in an investment vehicle including at least one investor andmultiple investments, comprising the steps of: determining fundmanagement information relating to said investment vehicle; determininginvestor Information relating to said at least one investor; calculatingan IPAC to determine the amount of money working in said investmentvehicle for an investor; and providing said IPAC to said investor;wherein said investment vehicle is selected from the group consistingof: (a) a private equity fund; and (b) a real estate private equityfund; said step of calculating said IPAC comprising${IPAC}_{j} = {p_{j}*{\left( {a + {\sum\limits_{i = 1}^{n}\left( {r_{i}*l_{i}} \right)}} \right)/c_{t}}}$Wherel _(i)=min(c _(i) ,m _(i))$c_{t} = {a + {\sum\limits_{i = 1}^{n}c_{i}}}$ where: n=the total numberof investments made by an investment vehicle to date, includinginvestments which have been liquidated such as being paid out in cash ordetermined to have zero value a=total called investor capital awaitinginvestment c_(i) the cost to the fund of the i^(th) investment of the ninvestments m_(i)=the most recent fair value of the i^(th) investment asdetermined by the fund's manager l_(i) (expressed formulaicallyabove)−minimum (c_(i), m_(i)); i.e. the lower of the cost of the i^(th)investment (i.e. c_(i)) or its most recent fair value as determined bythe fund manager, (i.e. m_(i)) r_(i)=the percentage of the i^(th)investment of the fund remaining at the time of the most recentdistribution p_(j)=the total capital called to date from the j^(th)investor c_(t) (expressed formulaically above)=the total value of calledcapital awaiting investment plus the aggregate cost of all n fundinvestments.
 12. A method of using a computer to manage an investmentprofile of an investor, comprising the steps of: determining an initialinvestment profile for said investor; developing, based on said initialinvestment profile, a recommended investment portfolio includingcalculating an initial investment amount in an investment fund includingmultiple investments; inputting into the computer fund managementinformation relating to a change in one of said multiple investments;receiving into the computer investor information relating to saidinvestor; calculating on the computer an IPAC to determine the amount ofmoney working in said investment vehicle for said investor; wherein saidinvestment fund is selected from the group consisting of: (a) a privateequity fund; and (b) a real estate private equity fund; said step ofcalculating said first IPAC comprising:${IPAC}_{j} = {p_{j}*{\left( {a + {\sum\limits_{i = 1}^{n}\left( {r_{i}*l_{i}} \right)}} \right)/c_{t}}}$Wherel _(i)=min(c _(i) ,m _(i))$c_{t} = {a + {\sum\limits_{i = 1}^{n}c_{i}}}$ where: n=the total numberof investments made by an investment vehicle to date, includinginvestments which have been liquidated such as being paid out in cash ordetermined to have zero value a=total called investor capital awaitinginvestment c_(i)=the cost to the fund of the i^(th) investment of the ninvestments m_(i)=the most recent fair value of the i^(th) investment asdetermined by the fund's manager l_(i) (expressed formulaicallyabove)−minimum (c_(i), m_(i)); i.e. the lower of the cost of the i^(th)investment (i.e. c_(i)) or its most recent fair value as determined bythe fund manager, (i.e. m_(i)) r_(i)=the percentage of the i^(th)investment of the fund remaining at the time of the most recentdistribution p_(j)=the total capital called to date from the j^(th)investor c_(t) (expressed formulaically above)=the total value of calledcapital awaiting investment plus the aggregate cost of all n fundinvestments; outputting from said computer said IPAC; and determining,using said IPAC, if said initial investment portfolio including saidchange in one of said multiple investments satisfies said initialinvestment profile.
 13. A method in accordance with claim 12 and furtherincluding the step of recommending to said investor a change in saidinvestment portfolio.
 14. A method in accordance with claim 13 andfurther including the steps of: outputting said recommended portfolio;outputting said change to said one of said multiple investments;outputting said IPAC; and providing said recommended portfolio, saidchange to said one of said multiple investments and said IPAC to saidinvestor.
 15. An apparatus for managing an investment profile of aninvestor, comprising: a processor; a memory connected to said processor,said memory containing instructions operative with said processor toperform the steps of: determining an initial investment profile for saidinvestor; developing, based on said initial investment profile, arecommended investment portfolio including calculating an initialinvestment amount in an investment fund including multiple investments;inputting into the processor fund management information relating to achange in one of said multiple investments; inputting into the processorinvestor information relating to said investor; calculating on theprocessor an IPAC to determine the amount of money working in saidinvestment vehicle for said investor; wherein said investment fund isselected from the group consisting of: (a) a private equity fund; and(b) a real estate private equity fund; said step of calculating saidfirst IPAC comprising:${IPAC}_{j} = {p_{j}*{\left( {a + {\sum\limits_{i = 1}^{n}\left( {r_{i}*l_{i}} \right)}} \right)/c_{t}}}$Wherel _(i)=min(c _(i) ,m _(i))$c_{t} = {a + {\sum\limits_{i = 1}^{n}c_{i}}}$ where: n=the total numberof investments made by an investment vehicle to date, includinginvestments which have been liquidated such as being paid out in cash ordetermined to have zero value a=total called investor capital awaitinginvestment c_(i)=the cost to the fund of the i^(th) investment of the ninvestments m_(i)=the most recent fair value of the i^(th) investment asdetermined by the fund's manager l_(i) (expressed formulaicallyabove)−minimum (c_(i), m_(i)); i.e. the lower of the cost of the i^(th)investment (i.e. c_(i)) or its most recent fair value as determined bythe fund manager, (i.e. m_(i)) r_(i)=the percentage of the i^(th)investment of the fund remaining at the time of the most recentdistribution p_(j)=the total capital called to date from the j^(th)investor c_(t) (expressed formulaically above)=the total value of calledcapital awaiting investment plus the aggregate cost of all n fundinvestments; outputting from said processor said IPAC; and determining,using said IPAC, if said initial investment portfolio including saidchange in one of said multiple investments satisfies said initialinvestment profile.
 16. The apparatus of claim 15 wherein said processoris further operative with the instructions in said memory to perform thesteps of: outputting said recommended portfolio; outputting said changeto said one of said multiple investments; outputting said IPAC; andtransmitting said recommended portfolio, said change to said one of saidmultiple investments and said IPAC to said investor.
 17. The apparatusof claim 15 wherein said memory further contains an investor databasecontaining information relating to the investors.
 18. The apparatus ofclaim 15 wherein said memory further contains an investment databasecontaining information relating to said multiple investments.
 19. Amethod for managing an investment profile of an investor, comprising thesteps of: determining an initial investment profile for said investor;developing, based on said initial investment profile, a recommendedinvestment portfolio including calculating an initial investment amountin an investment fund including multiple investments; determining achange in one of said multiple investments; calculating an IPAC todetermine the amount of money working in said investment vehicle forsaid investor; wherein said investment fund is selected from the groupconsisting of: (a) a private equity fund; and (b) a real estate privateequity fund said step of calculating said first IPAC comprising${I\; P\; A\; C_{j}} = \frac{p_{j}*\left( {a + {\sum\limits_{i = 1}^{n}\left( {r_{i}*l_{i}} \right)}} \right)}{c_{t}}$Wherel _(i)=min(c _(i) ,m _(i))$c_{t} = {a + {\sum\limits_{i = 1}^{n}c_{i}}}$ where: n=the total numberof investments made by an investment vehicle to date, includinginvestments which have been liquidated such as being paid out in cash ordetermined to have zero value a=total called investor capital awaitinginvestment c_(i)=the cost to the fund of the i^(th) investment of the ninvestments m_(i)=the most recent fair value of the i^(th) investment asdetermined by the fund's manager l_(i) (expressed formulaicallyabove)−minimum (c_(i), m_(i)); i.e. the lower of the cost of the j^(th)investment (i.e. c) or its most recent fair value as determined by thefund manager, (i.e. m_(i)) r_(i)=the percentage of the i^(th) investmentof the fund remaining at the time of the most recent distributionp_(j)=the total capital called to date from the j^(th) investor c_(t)(expressed formulaically above)=the total value of called capitalawaiting investment plus the aggregate cost of all n fund investments;and determining, using said IPAC, if said initial investment portfolioincluding said change in one of said multiple investments satisfies saidinitial investment profile.
 20. An apparatus for managing an investmentprofile of an investor, comprising: means for determining an initialinvestment profile for said investor; means for developing, based onsaid initial investment profile, a recommended investment portfolioincluding calculating an initial investment amount in an investment fundincluding multiple investments; means for inputting information relatingto a change in one of said multiple investments; means for calculatingan IPAC to determine the amount of money working in said investmentvehicle for said investor; wherein said investment fund is selected fromthe group consisting of: (a) a private equity fund; and (b) a realestate private equity fund; said step of calculating said first IPACcomprising${I\; P\; A\; C_{j}} = \frac{p_{j}*\left( {a + {\sum\limits_{i = 1}^{n}\left( {r_{i}*l_{i}} \right)}} \right)}{c_{t}}$Wherel _(i)=min(c _(i) ,m _(i))$c_{t} = {a + {\sum\limits_{i = 1}^{n}c_{i}}}$ where: n=the total numberof investments made by an investment vehicle to date, includinginvestments which have been liquidated such as being paid out in cash ordetermined to have zero value a=total called investor capital awaitinginvestment c_(i)=the cost to the fund of the i^(th) investment of the ninvestments m_(i)=the most recent fair value of the i^(th) investment asdetermined by the fund's manager l_(i) (expressed formulaicallyabove)−minimum (c_(i), m_(i)); i.e. the lower of the cost of the i^(th)investment (i.e. c_(i)) or its most recent fair value as determined bythe fund manager, (i.e. m_(i)) r_(i)=the percentage of the i^(th)investment of the fund remaining at the time of the most recentdistribution p_(j)=the total capital called to date from the j^(th)investor c_(t) (expressed formulaically above)=the total value of calledcapital awaiting investment plus the aggregate cost of all n fundinvestments; means for outputting said IPAC; and means for determiningusing said IPAC, if said initial investment portfolio including saidchange in one of said multiple investments satisfies said initialinvestment profile.
 21. The apparatus of claim 20 and furthercomprising: means for outputting said recommended portfolio; means foroutputting said change to said one of said multiple investments; meansfor outputting said IPAC; and means for transmitting said recommendedportfolio, said change to said one of said multiple investments and saidIPAC to said investor.
 22. A program product containingcomputer-executable instructions operative to manage an investmentprofile of an investor, said program product comprising: saidinstructions operative to control said computer to perform the steps of:determining an initial investment profile for said investor; developing,based on said initial investment profile, a recommended investmentportfolio including calculating an initial investment amount in aninvestment fund including multiple investments; inputting into thecomputer information relating to a change in one of said multipleinvestments; calculating on the computer an IPAC to determine the amountof money working in said investment vehicle for said investor; whereinsaid investment fund is selected from the group consisting of: (a) aprivate equity fund; and (b) a real estate private equity fund; saidstep of calculating said first IPAC comprising:${I\; P\; A\; C_{j}} = \frac{p_{j}*\left( {a + {\sum\limits_{i = 1}^{n}\left( {r_{i}*l_{i}} \right)}} \right)}{c_{t}}$Wherel _(i)=min(c _(i) ,m _(i))$c_{t} = {a + {\sum\limits_{i = 1}^{n}c_{i}}}$ where: n=the total numberof investments made by an investment vehicle to date, includinginvestments which have been liquidated such as being paid out in cash ordetermined to have zero value a=total called investor capital awaitinginvestment c_(i)=the cost to the fund of the i^(th) investment of the ninvestments m_(i)=the most recent fair value of the i^(th) investment asdetermined by the fund's manager l_(i) (expressed formulaicallyabove)−minimum (c_(i), m_(i)); i.e. the lower of the cost of the i^(th)investment (i.e. c_(i)) or its most recent fair value as determined bythe fund manager, (i.e. m_(i)) r_(i)=the percentage of the i^(th)investment of the fund remaining at the time of the most recentdistribution p_(j)=the total capital called to date from the j^(th)investor c_(t) (expressed formulaically above)=the total value of calledcapital awaiting investment plus the aggregate cost of all n fundinvestments; outputting from said computer said IPAC; and determining,using said IPAC, if said initial investment portfolio including saidchange in one of said multiple investments satisfies said initialinvestment profile.
 23. A method of using a computer to structure aninvestment portfolio of one investor having multiple investments,comprising the steps of: receiving fund management information relatingto said investment vehicle; receiving investor information relating tosaid investor; calculating on said computer, using said fund managementinformation and said investor information, an IPAC to determine theamount of money working in said investment vehicle; outputting from saidcomputer said IPAC; and determining, using said IPAC, if a change tosaid investment portfolio is appropriate; wherein said investmentvehicle is selected from the group consisting of: (a) a private equityfund; and (b) a real estate private equity fund; said step ofcalculating said first IPAC comprising:${I\; P\; A\; C_{j}} = \frac{p_{j}*\left( {a + {\sum\limits_{i = 1}^{n}\left( {r_{i}*l_{i}} \right)}} \right)}{c_{t}}$Wherel _(i)=min(c _(i) ,m _(i))$c_{t} = {a + {\sum\limits_{i = 1}^{n}c_{i}}}$ where: n=the total numberof investments made by an investment vehicle to date, includinginvestments which have been liquidated such as being paid out in cash ordetermined to have zero value a=total called investor capital awaitinginvestment c_(i)=the cost to the fund of the i^(th) investment of the ninvestments m_(i)=the most recent fair value of the i^(th) investment asdetermined by the fund's manager l_(i) (expressed formulaicallyabove)−minimum (c_(i), m_(i)); i.e. the lower of the cost of the i^(th)investment (i.e. c_(i)) or its most recent fair value as determined bythe fund manager, (i.e. m_(i)) r_(i)=the percentage of the i^(th)investment of the fund remaining at the time of the most recentdistribution p_(j)=the total capital called to date from the j^(th)investor c_(t) (expressed formulaically above)=the total value of calledcapital awaiting investment plus the aggregate cost of all n fundinvestments.
 24. An apparatus for structuring an investment portfolio ofone investor having multiple investments, comprising: a processor; amemory connected to said processor and storing fund managementinformation relating to said investment vehicle and investor informationrelating to said investor; said processor operative with said fundmanagement information and said investor information and instructions insaid memory to perform the steps of: calculating on said computer, usingsaid fund management information and said investor information, an IPACto determine the amount of money working in said investment vehicle;outputting from said computer said IPAC; and determining, using saidIPAC, if a change to said investment portfolio is appropriate; whereinsaid investment vehicle is selected from the group consisting of: (a) aprivate equity fund; and (b) a real estate private equity fund; saidstep of calculating said first IPAC comprising${I\; P\; A\; C_{j}} = \frac{p_{j}*\left( {a + {\sum\limits_{i = 1}^{n}\left( {r_{i}*l_{i}} \right)}} \right)}{c_{t}}$Wherel _(i)=min(c _(i) ,m _(i))$c_{t} = {a + {\sum\limits_{i = 1}^{n}c_{i}}}$ where: n=the total numberof investments made by an investment vehicle to date, includinginvestments which have been liquidated such as being paid out in cash ordetermined to have zero value a=total called investor capital awaitinginvestment c_(i)=the cost to the fund of the i^(th) investment of the ninvestments m_(i)=the most recent fair value of the i^(th) investment asdetermined by the fund's manager l_(i) (expressed formulaicallyabove)−minimum (c_(i), m_(i)); i.e. the lower of the cost of the i^(th)investment (i.e. c_(i)) or its most recent fair value as determined bythe fund manager, (i.e. m_(i)) r_(i)=the percentage of the i^(th)investment of the fund remaining at the time of the most recentdistribution p_(j)=the total capital called to date from the j^(th)investor c_(t) (expressed formulaically above)=the total value of calledcapital awaiting investment plus the aggregate cost of all n fundinvestments.
 25. A method of using a computer to initiate a buy, sell orhold of a fund in an investment vehicle, comprising the steps of:receiving fund management information relating to said investmentvehicle; receiving investor information relating to said investor;calculating on said computer, using said fund management information andsaid investor information, an IPAC to determine the amount of moneyworking in said investment vehicle; outputting from said computer saidIPAC; and initiating, based on said IPAC, a buy, sell or hold of saidfund; wherein said investment vehicle is selected from the groupconsisting of: (a) a private equity fund; and (b) a real estate privateequity fund; said step of calculating said IPAC comprising:${I\; P\; A\; C_{j}} = \frac{p_{j}*\left( {a + {\sum\limits_{i = 1}^{n}\left( {r_{i}*l_{i}} \right)}} \right)}{c_{t}}$Wherel _(i)=min(c _(i) ,m _(i))$c_{t} = {a + {\sum\limits_{i = 1}^{n}c_{i}}}$ where: n=the total numberof investments made by an investment vehicle to date, includinginvestments which have been liquidated such as being paid out in cash ordetermined to have zero value a=total called investor capital awaitinginvestment c_(i)=the cost to the fund of the i^(th) investment of the ninvestments m_(i)=the most recent fair value of the i^(th) investment asdetermined by the fund's manager l_(i) (expressed formulaicallyabove)−minimum (c_(i), m_(i)); i.e. the lower of the cost of the i^(th)investment (i.e. c_(i)) or its most recent fair value as determined bythe fund manager, (i.e. m_(i)) r_(i)=the percentage of the i^(th)investment of the fund remaining at the time of the most recentdistribution p_(j)=the total capital called to date from the j^(th)investor c_(t) (expressed formulaically above)=the total value of calledcapital awaiting investment plus the aggregate cost of all n fundinvestments.
 26. An apparatus for initiating a buy, sell or hold of afund in an investment vehicle, comprising: a processor; a memoryconnected to said processor and storing fund management informationrelating to said investment vehicle and investor information relating tosaid investor; said processor operative with said fund managementinformation and said investor information and instructions in saidmemory to perform the steps of: calculating on said computer, using saidfund management information and said investor information, an IPAC todetermine the amount of money working in said investment vehicle;outputting from said computer said IPAC; and initiating a buy, sell orhold, based on said IPAC, of said fund; wherein said investment vehicleis selected from the group consisting of: (a) a private equity fund; and(b) a real estate private equity fund; said step of calculating saidfirst IPAC comprising${I\; P\; A\; C_{j}} = \frac{p_{j}*\left( {a + {\sum\limits_{i = 1}^{n}\left( {r_{i}*l_{i}} \right)}} \right)}{c_{t}}$Wherel _(i)=min(c _(i) ,m _(i))$c_{t} = {a + {\sum\limits_{i = 1}^{n}c_{i}}}$ where: n=the total numberof investments made by an investment vehicle to date, includinginvestments which have been liquidated such as being paid out in cash ordetermined to have zero value a=total called investor capital awaitinginvestment c_(i)=the cost to the fund of the i^(th) investment of the ninvestments m_(i)=the most recent fair value of the i^(th) investment asdetermined by the fund's manager l_(i) (expressed formulaicallyabove)−minimum (c_(i), m_(i)); i.e. the lower of the cost of the i^(th)investment (i.e. c_(i)) or its most recent fair value as determined bythe fund manager, (i.e. m_(i)) r_(i)=the percentage of the i^(th)investment of the fund remaining at the time of the most recentdistribution p_(j)=the total capital called to date from the j^(th)investor c_(t) (expressed formulaically above)=the total value of calledcapital awaiting investment plus the aggregate cost of all n fundinvestments.